The number of new-home construction starts jumped 4.9% from September to October, Realtor.com reports. Builders began construction at a seasonally adjusted annual rate of 1.53 million in October while permits remained at September’s same level of 1.545 million. Housing starts exceeded MarketWatch economist expectations, but permitting fell short. Economists forecasted new-home starts to hit 1,49 million and permits to hit a pace of 1.57 million. Realtor.com says the unexpected surge in new-home construction starts comes from single-family starts, which surged 6.4%. The positive growth occurred in every US region except the Northeast.
All regions except the Northeast experienced an increase in housing starts despite rising coronavirus cases across many parts of the country, led by the 12.9% increase in the South. Permitting rose slightly in the South, West and Midwest, but fell markedly in the Northeast.
The big picture: The housing starts report follows yesterday’s release of the November home builder confidence index from the National Association of Home Builders. The index inched higher for the fourth consecutive month, demonstrating the upbeat outlook in the construction industry.
Indeed, virtually every home builder is seeing rising sales as Americans look to leave urban areas for larger homes in the suburbs only to find very few existing homes up for sale.